The printing User must have write privileges to the output directory and the folder must exist. If the Black Ice Printer Driver cannot create the file in the specified folder, it tries to create the file in the Windows Temp folder. If this fails, the Printer Driver tries the root of the C: drive, and then the driver quits trying to write the file.
The group file and the image file are saved by the port monitor. Because the port monitor runs on the local SYSTEM account, it inherits the privileges of the SYSTEM account and does not have any information on the User doing the printing. To generate output files, the port monitor must have write permission to the output directory. This means that the local SYSTEM account must have write permission to the output folder.